Jeffrey D. Sadow is an associate professor of political science at Louisiana State University Shreveport. If you're an elected official, political operative or anyone else upset at his views, don't go bothering LSUS or LSU System officials about that because these are his own views solely.
This publishes Sunday through Thursday with the exception of 7 holidays. Also check out his Louisiana Legislature Log especially during legislative sessions (in "Louisiana Politics Blog Roll" below).

Search This Blog

11.9.12

Despite high state support, structure hurts LA universities

Today is a big day in Louisiana higher education, a sector sliced many
times in recent years by planned and surprise budget cuts, with for most
institutions the reporting of enrollment figures (a couple of days late because
of Hurricane Isaac closures) that will determine its revenue picture for the
remainder of the year. Yet any good news (that is, enrollment increases,
meaning more revenue) for institutions only will delay the day of reckoning
coming to Louisiana higher education as a whole unless major policy changes occur.

Although the report from the State Higher
Education Officers Organization came out six months ago, recent interviews concerning data from its State Higher Education Funding 2011 edition demonstrate
that education policy to date has not significantly changed the headwinds
Louisiana higher education faces. Some of the larger trends affecting it the Louisiana State University Board of Supervisors
has heard recently. But the specific ills as they apply to this state’s higher
education system remain unaddressed and therefore unresolved.

Much moaning and groaning has circulated concerning funding of Louisiana
higher education, as the state in total has retracted over a half a billion
dollars, or about a fifth of its total state subsidization, since 2008. Tuition
increases have made up a good portion of the difference, leading to another lind
of carping about students (and taxpayers, through the Taylor Opportunity
Program for Students) paying more, but institutions and governance boards still
complain that not only are further significant cuts positioned to bring
apocalyptic results to their sector, but that increases in state subsidization
only may improve quality delivery.

The problem for that line of thinking is, in comparative perspective,
even at this reduced level Louisiana is one of the largest public sector
supporters of higher education in the nation. As of last year, in terms of full
time equivalent student enrollments, among the 50 states Louisiana ranked 11th
highest in state support at $7,309 (national average: $6,290). Over the past
five years, at an increase of 7.2 percent per year, that was the fourth-highest
increase in state support behind three other oil-rich states (national average:
-12.5 percent). Most stunningly, at an average of $77 per year, no state has
increased state spending on higher education per student more than Louisiana
since 1986.

Part of this can be explained by the rate of increase, just over 10
percent, in Louisiana of FTE enrollment over the past five years has been the
fourth lowest (national average: 16.9 percent). And the supposedly detrimental
increases in tuition place the state fifth lowest among all the states in terms
of increase over the past five years, yet despite increases of nearly 30
percent in that time the actual FTE revenue from tuition has gone down 18
percent, the most by far of any state – in part because it’s still fourth
lowest in tuition. Combine state support and tuition, and actually total higher
education revenue FTE for Louisiana barely dropped – and that was a relative
overall increase as nationwide there was a 2.3 percent decrease.

In other words, as many in Louisiana higher education warn the sky is
falling because of tight fiscal conditions and tuition increases, the fact is
compared to other states that do better jobs in a number of areas such as
retention, graduation, and in quality delivery, Louisiana taxpayers pump in
more money than in most at a higher rate of increase than almost anywhere else
and still don’t ask a lot for tuition compared to most at a rate of increase
slower than almost anywhere else. Overall, in the balancing the of two, the
state ranks 37th in total revenues per full time equivalent student.

Out of all of this comes a paradox – nationally, tuition represents
about 43 percent of all revenues generated, but in Louisiana that now across
all universities has gone over 50 percent. So if state support is relatively
high and tuition relatively low, then why has tuition such a high part of the total
mix? Because the emphasis always has been to get as many warm bodies in
classrooms as possible given an overbuilt
system as a way to shore up finances to support it.

Remarkably, the number of students attending baccalaureate-and-above
institutions of the state’s is almost identical last
year to that of 1994-1995,
with slow population growth and increased emphasis on community colleges
explaining that. This points to the real explanation of the numbers: in its
current form, the system spreads resources too thinly, creating overdependence
on tuition that especially creates downward revenue pressures on the four-year
schools.

One might think, therefore, if any additional funding is going to come
higher education’s way, it needs to come from tuition. Yet overall revenues
from tuition actually have been declining recently, likely because of three
things: increased TOPS utilization that transfers the source of revenue from
tuition to state support, the growth of community colleges with their lower
tuition rates, and struggles with retention rates where students stay on
average shorter periods in higher education. As it rises, some pricing out of
the market (probably not much, given TOPS, the wealth of lending and grants
involved backed by both the state and federal government, and relative
inelasticity of demand) also will impact tuition as a source of revenue.

Still, compared to other states, return seems low for high costs, and
the cutbacks to universities are real with paring of programs, increases in class
sizes, and fewer sections being offered, in part because of hiring into few open
tenure-track positions and a great increase in the use of adjunct faculty. Unfortunately,
the relatively generous state support per FTE gets wasted on too much
duplicative infrastructure, and tuition hikes seem only to be bringing revenues
increases to lower-level schools as, along with increased admission standards,
some students substitute attending four-year schools for two-year ones.

Once again, this points to a solution of paring the four-year schools,
through mergers (where
they make sense), making them into community colleges, or even closures.
Failure to do so creates a pair of unappetizing scenarios, where the citizenry
gets hit with tax increases and/or cuts in other services to continue subsidization
of this inefficiency, or most if not all schools slowly starve to death,
creating a vicious cycle where reductions impact service delivery in a way that
discourages enrollment, losing it to out-of-state, private, and proprietary
schools, and the system collapses in on itself that would force retrenchment on
even less favorable terms than if done sooner.

It’s a risky gamble to expect improved secondary education and
utilization of community colleges eventually to get demand to catch up to
supply at the four-year college level, alleviating the crisis without some system
change, in the hope that state finances can support the overbuilt system awhile
longer without neglecting other needs, or that tuition increases (along with TOPS
reform to make it more of a reward and less of an entitlement with a low
bar to qualify) can prove enough to keep the system afloat. And given the lag
time systemic changes requires where years pass before benefits get realized,
delay could be catastrophic.

Hopefully, today’s enrollment numbers will buy some breathing space. The
wisest use of that time is to start the process of realignment of higher education.

About Me

Subscribe To

Comment publishing requirements

You must be a registered user with an OpenID-compliant service to leave comments, which will be moderated. Any comments that do not address issues in the post for which they are intended will not be posted; neither will those that utterly lack intellectual coherence.